3. Understanding the customer Flashcards
What is the core transformation framework about?
Change the view of the customer - put the customer in the middle
For future potential - technology
Business model - not only looking at competitiors but also use other inspiration in the future
PUT THE PERSON IN THE MIDDLE - CUSTOMER
NETWORK MODEL
Left side - traditional model
Right side - connected world (person in the middle)
- Company connected with the network
- Network effects
PUT THE PERSON IN THE MIDDLE -
CUSTOMER CENTRIC ECOSYSTEM
- Seeing the end consumer in the middle, with your
product and service as just one of a large
connected web of other products and services
making up a user experience - Understand the consumer’s usage of the product
together with other products and services - Product must seamlessly fit into the user’s
ecosystem: World where users may never have to
take the step of integrating one product with
another one
PUT THE PERSON IN THE MIDDLE -
WHAT IS SEAMLESS INTEGRATION?
Seamless integration is the process where a new
module or feature of an application or hardware is
added or integrated without resulting in any
discernible errors or complications
- Allow for products to work with one another in a
more relevant way - So not only YOUR service and product, but also how
other companies and industries contribute to the rest
of the user experience
How much seamlessnes is a good thing?
It can get to seamless which can scare the customer
- When are the customers pushing back because they want control themselves
Can you think of some examples of a seamless experience?
Good:
- Integrated products with apple
- Advertisements on facebook etc.
Not good:
- Dentist app created event in own google calender
- Advertisements on facebook etc.
Commercials based on “talk”
LOOK AT VALUE DIFFERENTLY
- Ability for individual competitors to
differentiate themselves on product
alone diminishes as the value of the
connections goes up - Think of the most relevant
experience instead of the product - Do not rely solely on customers
feedback, because they only now
your current product –> future
customer
LOOK AT VALUE DIFFRENTLY: DIGITAL
OFFERINGS
= Information-enriched solutions wrapped in a seamless, personalized customer experience. Rely on software and data to generate new revenuegenerating value propositions.”
WHAT IS A CUSTOMER VALUE PROPOSITION?
“A customer value proposition (CVP) is a strategic tool
facilitating communication of an organization’s ability to
share resources and offer a superior value package to
targeted customers.” (Payne et al. 2017)
Connected World:
- Products may rely on a CVP that makes them free of
charge, so the business model needs some other
“customers” that generates revenue. - Digital providers may need to design a set of CVPs that
connect users, the firm, and other third parties to create
a viable value constellation that earns money.
Example: Uber
How can data be the new currency of the connected world?
Study compared the accuacy of human and computer-based personality judgements:
1.) Computer predictions based on genric digital footprint (FB Likes) are more accurate
han those made by the participant‘s FB friends
2.) Computer models show higher interjudge agreement
3.) Computer personality judgements have a higher external validity when predicting life outcomes such as substance use, political attitutdes, and physical health
Example: Google maps
* not in the mapping software business,
but they do information generation,
analysis, and brokering
* Customers and users are two distinct
groups
DATA THE NEW CURRENCY OF THE CONNECTED
WORLD - TWO TYPES OF PIU DATA
Not only your online behavior can inform companies,
also sensors embedded in products (e.g. connected IoT
products, APPs) produce data in real-time
- Product view: How well is the product performing?
Important for improving the product - Consumer view: How is the user experiencing the
product?
IS WEB 3.0 A DATA REVOLUTION?
- New tools are emerging around Web 3.0 that could enable people
to own and control their data. - Web 3.0” is envisioned as an open and decentralized version of the
internet — free from the domination of a handful of large firms. - Possible internet of the future:
o distributed ledger technologies (DLTs) and storage on the
blockchain will drive a data revolution (bridging technology and
personal privacy)
o a truly distributed internet may one day enable users to manage
and monetize their personal data, all while accessing an ocean of
digital services over public blockchains.
o connecting data-driven technologies like artificial intelligence and
machine learning to completely distributed data ecosystems.
HOW DO COMPANYS TRANSFORM TO
DIGITAL?
Source: Ross et al.
Operational Backbone: A
Coherent set of standardized,
integrated systems, processes,
and data supporting a
company‘s core operations
Digital Platform: Repository of
business, data, and infrastructure
components used to rapidly
configure digital offerings
External Developer Platform:
Repository of digital components
open for external parties
Shared Customer Insights:
Organizational learning about
what customers will pay for and
how digital technologies can
deliver to their demands
Accountability framework:
Distribution of responsibilities for
digital offerings and
components that balances
autonomy and alignment
WHAT ARE CUSTOMER INSIGHTS?
- Knowledge about the customer that is
valuable for the firm - Strategic asset: customer insight is a
resource that is of value if it is rare, difficult
to imitate and of potential use - Customer insight is distinct from customer
information, as information requires
transformation to generate insights. - The resource of customer insight supports
the firm’s response to environmental threats
and opportunities and helps achieve
customer-focused growth.
Source: (Said et al. 2015)
COMPANIES LEARN WHAT MAKES A VIABLE
DIGITAL OFFERING
- Successful digital offering: Intersection
between what a customer desired and
what digital technologies make possible. - Difficult to find:
1. Most companies have little experience
imagining what solutions they might
develop with digital technologies.
- Customers often can’t imagine what they
want until they have it.
Customer enthusiasm (Willingness to pay)
DESIGNING FOR SHARED CUSTOMER INSIGHTS
= Creating roles and processes that help a company find
the intersection between what solution it can deliver and
what solutions the customer wants
These practices are associated with increased revenues
from digital offerings:
1. A high-level digital vision for customer value
2. A constant flow of digital experiments that test how
digital technologies can deliver customer value
3. Tightly integrated product development, sales and
service processes
4. Customer co-creation of digital offerings
5. Formalized sharing of learning across the enterprise
- HIGH-LEVEL VISION
- Digital transformation starts when you
create a transformative vision of how your
firm will be different in the digital world, and
then engage your employees to make the
vision a reality. - In a digital economy a digital vision is the
business vision. - Vision should focus on the organization, not
only on the technology - Focus on how you can enhance the
experience of your customers, streamline
your operations, or transform your business
models. - Familarize yourself with new digital practices that can be
an opportunity or a threat to your industry and company - Identify bottle necks or headaches – in your company
and in your customers – that resulted from the limits of
old technologies, and consider how you might resolve
these problems digitally. - Consider which of your strategic assets will remain
valuable in the digital era - Craft a compelling and transformative digital vision
- Ensure that the vision specifies both intend and outcome
- Make your digital vision specific enough to give
employees a clear direction, while giving them the
flexibility to build on it. - Constantly be looking to extend your vision using the
capabilities you have created.
